Just as we had done on Friday, we broke below 1100 in the ES contract only to rebound from that level. For that reason, I will be looking carefully to see if we can hold above the overnight lows in this morning's trade. Note how we're building volume in the 1105 region prior to the market open; this is also a level I'm tracking to see if we can reject value at that level vs. continue to accept as part of a range trade.
Finally, we're seeing some carryover of a firm U.S. dollar and weak commodities this morning: themes that have been associated with weak stocks lately, but that came a bit unhinged on Friday. Keep an eye on the sectors that, until late in the week, had been laggards: financial issues and small caps. If we are going to see a firm stock market, I would expect those sectors to show continued rebound from their relative weakness.
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